Aging condos in Ontario will need expensive repairs in the future, report finds
About 15 per cent of Ontario households currently live in condominiums and more than half of new homes being built in the province are also condominium units.
There are 900,000 condominium units in the province that are managed by 11,000 condo corporations and some units that are more than 30 years old are starting to show their age.
A recent research report released by the Canadian Institute of Actuaries found that condo boards should be making sure there are enough reserve funds being budgeted to help pay for expensive repairs in the future.
Jon Juffs, with McIntosh Perry, an engineering firm which has expertise in reserve fund studies said that condominium boards need to make sure they have funds ready for unexpected repairs.
“A large number of condo corporations can realistically expect to suffer a special assessment because the planning horizons are so short and the decisions around the costs are driven by either deferrals or trying to get the least expensive repairs which maybe won’t last as long,” said Juffs.
A special assessment is when owners are asked for an additional payment on top of their monthly maintenance fees to cover a major expense such as replacing roofs, exterior glass walls, balconies, foundations and parking garages.
While condo owners pay maintenance fees each month to look after their building, there may not be enough money collected to cover major renovations when they are needed.
Also, compounding the issue is that many condo owners put pressure on their boards to keep monthly maintenance fees as low as possible.
"When you're not doing the proper increases you’re not saving enough money when the big bills come due," said Mark Weisleder, a real estate lawyer with the firm RealEstateLawyers.ca LLP.
Special assessments can range from a few thousand dollars to as much as $50,000. The assessments are usually divided by the number of units in a building or complex although the assessments may varying depending on the square footage of the units.
If a roof for a building is needed and the cost is $1,000,000 and there are 200 unit holders, a special assessment would be issued of $5,000 each to the 200 owners.
In the event someone refuses to pay a special assessment a lien could be placed on their unit.
While a rise in condo maintenance fees can be frustrating for owners if it is helping to top up the reserve fund that can prevent special assessments in the future.
“If a larger percentage is going into your reserve fund than people should understand that they are putting money away and that is a good thing because it means the money will be there when repairs are needed” said Weisleder.
If your building is in need of repairs now and they're deferred for too long, the situation could get worse and more expensive to fix later.
“If you are already noticing deterioration (in your building) and you are putting it off that deterioration is only going to get worse and the cost will get bigger to repair," said Juffs.
It's important when buying a condo to check it's status certificate to see the state of the building's finances and to check if there are any lawsuits or special assessments pending.
CTVNews.ca Top Stories
NEW Keeping these exotic pets is 'cruel' and 'dangerous,' Canadian animal advocates say
Canadian pet owners are finding companionship beyond dogs and cats. Tigers, alligators, scorpions and tarantulas are among some of the exotic pets they are keeping in private homes, which pose risks to public safety and animal welfare, advocates say.
NEW Life got in the way of one woman's reunion with her father, but a DNA test gained her a family
Anne Marie Cavner was the closest she'd ever been to meeting her biological father, but then life dealt her a blow. From an unexpected loss to a host of new relationships, a DNA test changed her life, and she doesn't regret a thing.
Doctors ask Liberal government to reconsider capital gains tax change
The Canadian Medical Association is asking the federal government to reconsider its proposed changes to capital gains taxation, arguing it will affect doctors' retirement savings.
Quebec farmers have been protesting since December. Is anyone listening?
Upset about high interest rates, growing paperwork and heavy regulatory burdens, protesting farmers have become a familiar sight across Quebec since December.
'Catch-and-kill' strategy to be a focus as testimony resumes in Trump hush money case
A veteran tabloid publisher was expected to return to the witness stand Tuesday in Donald Trump's historic hush money trial.
Quebec Health Department reports 28 cases of eye damage linked to solar eclipse
Quebec's Health Department says it has received 28 reports of eye damage related to the April 8 total solar eclipse that passed over southern parts of the province.
Psychologist becomes first person in Peru to die by euthanasia after fighting in court for years
A Peruvian psychologist who suffered from an incurable disease that weakened her muscles and had her confined to her bed for several years, died by euthanasia, her lawyer said Monday, becoming the first person in the country to obtain the right to die with medical assistance.
Diver pinned under water by an alligator figured he had choice. Lose his arm or lose his life
An alligator attacked a diver on April 15 as he surfaced from his dive, nearly out of air. His tank emptied with the gator's jaws crushing the arm he put up in defence.
How quietly promised law changes in the 2024 federal budget could impact your day-to-day life
The 2024 federal budget released last week includes numerous big spending promises that have garnered headlines. But, tucked into the 416-page document are also series of smaller items, such as promising to amend the law regarding infant formula and to force banks to label government rebates, that you may have missed.